Four reasons Yahoo should not ban at-home workers

Yahoo's 14,500 employees have until June to drive into work every day -- otherwise they could be fired. There are four reasons this is a bad idea.

On February 22, AllThingsD published a leaked copy of a Yahoo memo from its head of Human Resources, Jackie Reses, that proclaimed, “We need to be one Yahoo!, and that starts with physically being together.”

Ms. Reses wields the carrot and the stick in her announcement of the new work-at-Yahoo's-office policy. She argues that in-person meetings boost the quality of decisions and business ideas.

As she wrote, "Some of the best decisions and insights come from hallway and cafeteria discussions, meeting new people, and impromptu team meetings."

And telecommuting slows down Yahoo and cuts into the quality of its services. According to Ms. Reses, "Speed and quality are often sacrificed when we work from home."

The forwarded memo -- labeled "YAHOO! PROPRIETARY AND CONFIDENTIAL INFORMATION — DO NOT FORWARD" -- hints that any Yahoo employee who currently works from home will not be able to do that when June rolls around -- except when the "cable guy" is scheduled for a visit.

Google is heavily-populated by super-smart engineers who invent new businesses that help it to boost its top line. And new business ideas get better when smart people from different disciplines randomly bump into each other in the same building to discuss and refine those ideas. Nevertheless, Google allows its employees to work at home on a case-by-case basis, according to the New York Times.

But there are other kinds of jobs that are operational, rather than creative. For example, a person who helps solve a technical problem with Yahoo! Mail does not come up with new business ideas -- whether he works at home or in an office with other customer service people.

Simply put, some jobs get done better if people interact in person and others are better done at home, where workers can do their jobs more productively without interruption from others. Applying a meat-ax policy of requiring all Yahoo workers to report to an office every day is a bad idea.

Here are four reasons that Yahoo's new policy is an epic fail:

1. More mediocre employees.

The tone of Reses' memo is so upbeat that it's clear Yahoo's workforce is feeling demoralized. And why not? Ms. Mayer is Yahoo’s fifth CEO in four years. But as Bloomberg reports, Ms. Mayer "worked from her California home in October in the weeks following the birth of her first child."

This hypocrisy will increase the self-imposed pressure on the best Yahoo employees who work at home to find jobs at companies that will accommodate their schedules. Only those telecommuters who can't get jobs elsewhere will bend to Ms. Mayer's will.

2. Higher employee stress and lower productivity.

Brad Harrington, executive director of the Boston College Center for Work & Family, notes that people who work from home tend to have less stress and are more productive, partly because they don’t invest time and money in commuting, and also because they can balance their personal and work lives.

So logic suggests that when Yahoo's current at-home workers are required to drive into its offices each day, they'll be more stressed out and less productive.

3. Higher fixed costs.

Unless Yahoo already has cubicles in place for all of its employees, ending its work-at-home policy means that shareholders will fork over more money for fixed costs such as real estate, telephones, and all the other costs required to house employees during the day.

For example, between 2005 and 2012, insurance company Aetna boosted from 9 percent to 47 percent the proportion of its workforce that telecommutes. Aetna cut its real estate costs by $78 million during that time, Aetna spokeswoman, Susan Millerick, told the Times.

While Yahoo is not as process-intensive as Aetna, logic suggests that Yahoo's strategy of forcing employees to commute will yield higher real estate costs.

4. More traffic and air pollution.

Yahoo's work-at-the-office policy will mean more people driving. That number could range from several hundred to many more who work one or two days a week from home. And more commuters mean more traffic and more air pollution.

This will not impose an additional cost on Yahoo shareholders -- just all the other people who don't like a slower commute and dirtier air.

The good news for Ms. Mayer is that Yahoo can reverse this bad idea with a simple mea culpa memo. For the benefit of Yahoo shareholders, employees, and communities let's hope that happens soon.